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Singapore Income Tax Act - Chapter 134

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Income Tax Act
(CHAPTER 134)
Long Title
Part I PRELIMINARY
1 Short title
2 Interpretation
Part II ADMINISTRATION
3 Appointment of Comptroller and other officers
4 Powers of Comptroller
5 Approved pension or provident fund or society
6 Official secrecy
7 Rules
8 Service and signature of notices
9 Free postage
Part III IMPOSITION OF INCOME TAX
10 Charge of income tax
10A Profits of investment company
10B Profits of unit trusts
10C Excess provident fund contributions, etc., deemed to be income
10D Income from finance or operating lease
10E Ascertainment of income of investment holding company
10F (Repealed)
10G (Repealed)
10H Ascertainment of income from business of hiring out motor cars or providing driving
instruction
10I Reduction of share capital
10J Shares buyback
10K Shares redemption
10L Withdrawals from Supplementary Retirement Scheme
10M Buyback of preferential shares

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10N Securities lending or repurchase arrangement
11 Ascertainment of income of clubs, trade associations, etc.
12 Sources of income Trading operations carried on partly in Singapore
Part IV EXEMPTION FROM INCOME TAX
13 Exempt income
13A Exemption of shipping profits
13B Exemption of certain dividends
13C Exemption of income of non­resident arising from funds managed by fund manager in
Singapore
13D Exemption of certain dividends of approved investment company
13E Exemption of dividends from foreign income
13F Exemption of international shipping profits
13G Exemption of income of foreign trust
13H Exemption of income of venture company
13I Exemption of certain dividends of Singapore Exchange Derivatives Trading Limited
13J Exemption of tax on gains or profits from entrepreneurial employee equity­based
remuneration scheme
13K Exemption of certain dividends of Singapore Exchange Derivatives Clearing Limited
13L Exemption of tax on gains or profits from company employee equity­based remuneration
scheme
13M Exemption of income of charities
13N Exemption of tax on income derived by non­ordinarily resident individual
Part V DEDUCTIONS AGAINST INCOME
14 Deductions allowed
14A Deduction for patenting costs
14B Further deduction for expenses relating to approved trade fairs, exhibitions or trade
missions or to maintenance of overseas trade office
14C (Repealed)
14D Expenditure on research and development
14E Further deduction for expenditure on research and development project
14F Management expenses of investment companies
14G (Repealed)

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14H Expenditure on building modifications for benefit of disabled employees
14I Provisions by banks and qualifying finance companies for doubtful debts and diminution
in value of investments
14J Further deduction for expenditure on research and development of new financial activities
14K Further or double deduction for overseas investment development expenditure
14L Further deduction for expenses incurred in relocation or recruitment of overseas talent
14M Deduction for hotel refurbishment expenditure
14N Deduction of upfront land premium
14O Deduction for special reserve of approved general insurance company
15 Deductions not allowed
Part VI CAPITAL ALLOWANCES
16 Initial and annual allowances for industrial buildings and structures
17 Balancing allowances and charges for industrial buildings and structures
18 Definitions for sections 16 and 17
19 Initial and annual allowances for machinery or plant
19A Allowances of 3 years write off for machinery and plant, and 100% write off for
computer, prescribed office automation equipment and robot, etc.
19B Writing­down allowances for intellectual property rights
19C Writing­down allowances for approved cost­sharing agreement for research and
development activities
19D Writing­down allowance for IRU
20 Balancing allowances and charges for machinery or plant
21 Replacement of machinery or plant
22 Expenditure on machinery or plant
22A Order of set­off of allowances
23 Carry forward of allowances
24 Special provisions as to certain sales
25 (Repealed)
Part VII ASCERTAINMENT OF CERTAIN INCOME
26 Profits of insurance companies
27 Profits of non­resident shipowner or charterer
28 Profits of non­resident air transport and cable undertakings

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29 Income from certain dividends to include tax thereon
30 Certain undistributed profits may be treated as distributed
31 Income arising from settlements
32 Valuation of trading stock on discontinuance or transfer of trade or business
33 Comptroller may disregard certain transactions and dispositions
34 Discretion no bar to appeal
Part VIII ASCERTAINMENT OF STATUTORY INCOME
35 Basis for computing statutory income
35A Cessation of source of income commenced before 1st January 1969
36 Partnership
Part IX ASCERTAINMENT OF ASSESSABLE INCOME
37 Assessable income
37A Restriction on deduction of trading losses against dividends
37B Adjustment of capital allowances, losses or donations between income subject to tax at
different rates
37C Group relief for Singapore companies
Part X ASCERTAINMENT OF CHARGEABLE INCOME AND PERSONAL RELIEFS
38 Chargeable income
39 Relief and deduction for resident individual and Hindu joint family
40 Relief for non­resident citizens and certain other non­residents
40A Relief for non­resident public entertainers
40B Relief for non­resident employees
40C Relief for non­resident SRS members
40D Relief for non­resident deriving income from activity as public entertainer and employee,
etc.
41 Proof of claims for deduction or relief
Part XI RATES OF TAX
42 Rates of tax upon individuals
42A Rebate for second, third and fourth child of family
43 Rate of tax upon companies and others
43A Concessionary rate of tax for Asian Currency Unit, Fund Manager and securities

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company
43B Special rate of tax for non­resident shipowner or charterer or air transport undertaking
43C Exemption and concessionary rate of tax for insurance and reinsurance business
43D Concessionary rate of tax for offshore transactions on any market maintained by
Singapore Exchange or its subsidiaries
43E Concessionary rate of tax for headquarters company
43F Concessionary rate of tax for oil trading company
43G Concessionary rate of tax for Finance and Treasury Centre
43H Concessionary rate of tax for international commodity trading company
43I Concessionary rate of tax for offshore leasing of machinery and plant
43J Concessionary rate of tax for trustee company
43K Concessionary rate of tax for members of commodity futures exchange
43L Concessionary rate of tax for art and antique dealers
43M (Repealed)
43N Concessionary rate of tax for income derived from debt securities
43O Concessionary rate of tax for cyber trading
43P Concessionary rate of tax for global trading company
43Q Concessionary rate of tax for financial sector incentive company
Part XII DEDUCTION OF TAX AT SOURCE
44 Deduction of tax from dividends of companies
44A Transitional provisions for company subjected to former imputation system
45 Withholding of tax in respect of interest paid to non­resident persons
45A Application of section 45 to royalties, management fees, etc.
45B Application of section 45 to non­resident director’s remuneration
45C Application of section 45 to distribution by unit trust
45D Application of section 45 to gains from real property transaction
45E Application of section 45 to withdrawals by non­citizen SRS members, etc.
45F Application of section 45 to income from profession or vocation carried on by non­
resident individual, etc.
Part XIII ALLOWANCES FOR TAX CHARGED
46 Tax deducted from dividends, interests, etc.
47 Special allowance for interest received as trading receipts

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Part XIV RELIEF AGAINST DOUBLE TAXATION
48 Relief in respect of Commonwealth income tax
49 Double taxation arrangements
50 Tax credits
50A Unilateral tax credits
Part XV PERSONS CHARGEABLE
Husband and wife
51 Income of wife
Trustees, agents and curators
52 Chargeability of trustees, etc.
53 Chargeability of agent of person residing out of Singapore
54 Liability of person chargeable in respect of incapacitated person
55 Liability of managers of companies or bodies of persons
56 Indemnification of representative
57 Power to appoint agent
58 Deceased persons
59 Company wound up
60 Chargeability of joint trustees
61 Hindu joint families
Part XVI RETURNS
62 Notice of chargeability and returns
63 Furnishing of estimate of chargeable income if no return is made under section 62
64 Comptroller may call for further returns
65 Power to call for returns, books, etc.
65A Statement of bank accounts, assets, etc.
65B Power of Comptroller to obtain information
65C Failure to comply with notices issued by Comptroller
66 Returns to be deemed to be furnished by due authority
67 Keeping of books of account and giving of receipts
68 Official information and secrecy, and returns by employer

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69 Lists to be prepared by representative or agent
70 Occupiers to furnish return of rent payable
71 Return to be made by partnership
71A Filing of return by electronic transmission
Part XVII ASSESSMENTS AND OBJECTIONS
72 Comptroller to make assessments
73 Advance assessments
74 Additional assessments
75 Waiver of small assessments
76 Service of notices of assessment and revision of assessment
77 Errors and defects in assessment and notice
Part XVIII APPEALS
78 Board of Review
79 Right of appeal
80 Hearing and disposal of appeals
81 Appeals to High Court
82 Cases stated for High Court
83 Proceedings before Board and High Court
84 Assessments to be final and conclusive
Part XIX COLLECTION, RECOVERY AND REPAYMENT OF TAX
85 Time within which payment is to be made
86 Recovery of tax from persons leaving Singapore
87 Penalty for non­payment of tax and enforcement of payment
88 Change of address
89 Suit for tax by Comptroller
90 Statement of Comptroller sufficient
91 Deduction of tax from emoluments and pensions
92 Remission of tax
93 Repayment of tax
93A Relief in respect of error or mistake
Part XX OFFENCES AND PENALTIES

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REVISED EDITION 2004
(1st January 2004)
An Act to impose a tax upon incomes and to regulate the collection thereof.
[1st January 1948]
PART I
PRELIMINARY
Short title
1. This Act may be cited as the Income Tax Act.
Interpretation
2.—(1) In this Act, unless the subject or context otherwise requires —
“accountant” means a public accountant within the meaning of the Accountants Act
(Cap. 2);
“advocate and solicitor” means an advocate and solicitor within the meaning of the
Legal Profession Act (Cap. 161);
“annual value” has the same meaning as in section 2 of the Property Tax Act (Cap.
254) and shall be ascertained in the same manner as annual value is ascertained
under that Act;
“approved pension or provident fund or society” means a pension or provident fund or
society approved by the Comptroller under section 5;
“basis period” for any year of assessment means the period on the profits of which tax
for that year falls to be assessed;
“body of persons” means any body politic, corporate or collegiate, any corporation
sole and any fraternity, fellowship or society of persons whether corporate or
unincorporate but does not include a company or a partnership;
“Central Fund Administration” means any institution of a public character appointed
to be a Central Fund Administrator under section 107(1);
“Commonwealth”, in relation to a country, means any country recognised by the
President to be a Commonwealth country and “part of the Commonwealth” means
any Commonwealth country, colony, protectorate or protected state or any other
territory administered by the government of any Commonwealth country;
“company” means any company incorporated or registered under any law in force in
Singapore or elsewhere;
“Comptroller” means the Comptroller of Income Tax appointed under section 3(1) and
includes, for all purposes of this Act except the exercise of the powers conferred
upon the Comptroller by sections 45(7), 67(1)(a), 95, 96, 96A and 101, a Deputy
Comptroller or an Assistant Comptroller so appointed;
“country” includes a territory;

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(a)
(b)
(a)
(b)
(a)
(b)
(c)
(d)
(e)
“crops” includes any form of vegetable produce;
“earned income” means the statutory income of an individual or a Hindu joint family,
reduced by any deduction made under section 37(3)(a)from —
gains or profits from any trade, business, profession, vocation or employment
on which tax is payable under section 10(1), where the Comptroller is
satisfied that such gains or profits are immediately derived from the carrying
on or exercise by such individual or Hindu joint family, as the case may be,
of such trade, business, profession, vocation or employment; and
any pension on which tax is payable under section 10(1)(e) given to the
individual in respect of the past services of such individual or any deceased
individual;
“employee” —
in relation to a company, includes a director of the company; and
in relation to a statutory board, includes the chairman and any member of the
statutory board,
and “employer” and other cognate expressions shall be construed accordingly;
“employment pass” means an employment pass issued by the Controller of
Immigration under the Immigration Regulations (Cap. 133, Rg 1);
“executor” means any executor, administrator or other person administering the estate
of a deceased person;
“Fund Manager” or “fund manager” means a company holding a capital markets
services licence under the Securities and Futures Act (Cap. 289) for fund
management or that is exempted under that Act from holding such a licence;
“goods” includes currency and specie;
“harvesting” includes the collection of crops, however effected;
“Hindu joint family” means what in any system of law prevailing in India is known as
a Hindu joint family or a co­parcenary;
“incapacitated person” means any infant, lunatic, idiot or insane person;
“institution of a public character” means an institution or fund in Singapore which
is —
a hospital not operated or conducted for profit;
a public or benevolent institution not operated or conducted for profit;
a public authority or society not operated or conducted for profit and which
is engaged in research or other work connected with the causes, prevention
or cure of disease in human beings, where the donation is for such activities;
a university or a public fund for the establishment, maintenance, enlargement
or improvement of a university;
an educational institution not operated or conducted for profit, or a public
fund for the establishment, maintenance, enlargement or improvement of

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(f)
(g)
(h)
(i)
(a)
(b)
(c)
(d)
(e)
(f)
(g)
(h)
(i)
(i)
(A)
(B)
(C)
(ii)
such an educational institution;
a public or private fund for the provision, establishment or endowment of a
scholarship, exhibition or prize in a university, or an educational institution
not operated or conducted for profit;
a public fund established and maintained for the relief of distress among
members of the public;
a charitable institution or a body of persons or a trust established for
charitable purposes only; or
an organisation not operated or conducted primarily for profit which is
engaged in or connected with the promotion of culture or the arts or with the
promotion of sports;
“life annuity” means an annuity payable under a policy issued to an SRS member for a
term ending with, or at a time ascertainable only by reference to, the end of his life;
“local forces” means the Singapore Armed Forces and any volunteer or reserve forces
attached thereto;
“permanent establishment” means a fixed place where a business is wholly or partly
carried on including —
a place of management;
a branch;
an office;
a factory;
a warehouse;
a workshop;
a farm or plantation;
a mine, oil well, quarry or other place of extraction of natural resources;
a building or work site or a construction, installation or assembly project,
and without prejudice to the generality of the foregoing, a person shall be deemed
to have a permanent establishment in Singapore if that person —
carries on supervisory activities in connection with a building or work site or
a construction, installation or assembly project; or
has another person acting on that person’s behalf in Singapore who —
has and habitually exercises an authority to conclude contracts;
maintains a stock of goods or merchandise for the purpose of
delivery on behalf of that person; or
habitually secures orders wholly or almost wholly for that person or
for such other enterprises as are controlled by that person;
“person” includes a company, body of persons and a Hindu joint family;

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(a)
(b)
(a)
(b)
(c)
(d)
(e)
(a)
(b)
“plantation” means any land used for the growing and harvesting of crops;
“prescribed” means prescribed by rules or regulations made under this Act;
“prescribed retirement age” has the same meaning as in the Retirement Age Act (Cap.
274A);
“professional visit pass” means a professional visit pass issued by the Controller of
Immigration under the Immigration Regulations (Cap. 133, Rg 1);
“replanting” means the replacement of the crop of any product on any area of land by
the planting on the same area —
of a crop of the same product; or
of a crop of a different product approved by the Minister;
“research and development” means any systematic or intensive study carried out in the
field of science or technology with the object of using the results of the study for
the production or improvement of materials, devices, products, produce, or
processes, but does not include —
quality control or routine testing of materials, devices or products;
research in the social sciences or the humanities;
routine data collection;
efficiency surveys or management studies; or
market research or sales promotion;
“research and development organisation” means a body or an organisation which
provides research and development services for any trade or business;
“resident in Singapore” —
in relation to an individual, means a person who, in the year preceding the
year of assessment, resides in Singapore except for such temporary absences
therefrom as may be reasonable and not inconsistent with a claim by such
person to be resident in Singapore, and includes a person who is physically
present or who exercises an employment (other than as a director of a
company) in Singapore for 183 days or more during the year preceding the
year of assessment; and
in relation to a company or body of persons, means a company or body of
persons the control and management of whose business is exercised in
Singapore;
“return” includes an electronic return under section 71A;
“SRS account” means an account opened with an SRS operator by an SRS member;
“SRS contribution cap”, in relation to an SRS member, means the maximum
contribution prescribed under section 10L that may be made by the member to his
SRS account in any year under the SRS;
“SRS member” means a member of the Supplementary Retirement Scheme;

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“SRS operator” means any company approved by the Minister, or such person as he
may appoint, for the purposes of the Supplementary Retirement Scheme;
“Supplementary Retirement Scheme” or “SRS” means the Supplementary Retirement
Scheme established by regulations made under section 10L;
“tax” means the income tax imposed by this Act;
“work permit” means a work permit issued by the Controller of Work Permits under
the Employment of Foreign Workers Act (Cap. 91A);
“year of assessment” means the period of 12 months commencing on 1st January
1948, and each subsequent period of 12 months.
(2) For the purposes of this Act, where an individual is present in Singapore for any part
of a day his presence on that day shall be counted as one day.
PART II
ADMINISTRATION
Appointment of Comptroller and other officers
3.—(1) For the due administration of this Act, the Minister may, by notification in the
Gazette, appoint a Comptroller of Income Tax, and such Deputy Comptrollers, Assistant
Comptrollers and other officers and persons as may be necessary.
(2) The Minister may, by notification in the Gazette, appoint a Senior Investigation
Officer, Income Tax, and may by such or a subsequent notification authorise such officer to
exercise all or such of the powers of the Comptroller under this Act as may be specified in
such notification but without prejudice to the exercise by the Comptroller of such powers.
Powers of Comptroller
4.—(1) The Comptroller may, by notification in the Gazette or in writing, authorise any
person, within or without Singapore, to perform or to assist in the performance of any
specific duty imposed upon the Comptroller by this Act.
(2) Subject to such conditions as the Comptroller may specify, the Comptroller may, by
notification in the Gazette, direct that any information, return or document required to be
supplied, forwarded or given to the Comptroller may be supplied to such other person, being
a person who has made and subscribed a declaration of secrecy in accordance with
section 6(1), as the Comptroller may direct.
(3) The Comptroller shall be responsible for the assessment and collection of tax and
shall pay all amounts collected in respect thereof into the Consolidated Fund.
(4) The Comptroller may specify the form of any return, claim, statement or notice to be
made or given under this Act.
Approved pension or provident fund or society
5. The Comptroller may, subject to such conditions as he may think fit to impose, approve
[26/73; 37/75; 5/77; 28/80; 13/84; 31/86; 3/89; 11/94; 32/95; 1/98; 31/98; 32/99; 24/2001; 42/2001; 37/2002; 21/2003]
[13/84]

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(a)
(b)
(a)
(b)
any pension or provident fund or society for the purposes of this Act and may (without
prejudice to the exercise of any power in that behalf conferred on him by any condition so
imposed) at any time withdraw any approval previously given in respect of any such fund or
society.
Official secrecy
6.—(1) Every person having any official duty or being employed in the administration of
this Act shall regard and deal with all documents, information, returns, assessment lists and
copies of such lists relating to the income or items of the income of any person, as secret and
confidential, and shall make and subscribe a declaration in the form prescribed to that effect
before the Comptroller or a Magistrate.
(2) Every person having possession or control over any documents, information, returns,
assessment lists or copies of such lists relating to the income or items of income of any
person, who at any time otherwise than for the purpose of this Act or with the express
authority of the President —
communicates or attempts to communicate such information or anything contained
in such documents, returns, lists or copies to any person; or
suffers or permits any person to have access to any such information or to
anything contained in such documents, returns, lists or copies,
shall be guilty of an offence.
(3) No person appointed under, or employed in carrying out, the provisions of this Act
shall be required to produce in any court any return, document or assessment, or to divulge
or communicate to any court any matter or thing coming under his notice in the performance
of his duties under this Act except as may be necessary for the purpose of carrying into effect
the provisions of this Act, or in order to institute a prosecution, or in the course of a
prosecution, for any offence committed in relation to income tax.
(4) The obligation as to secrecy imposed by this section shall not prevent the disclosure to
the authorised officers of the government of any other country of such facts as may be
necessary —
to enable the proper relief from income tax to be given in either country, where
provision exists for the granting of relief in respect of taxes paid in the other
country; or
for the avoidance of double taxation and the prevention of fiscal evasion in either
country, where an arrangement under section 49 is in operation between the
government of that country and the Government of Singapore.
(5) Notwithstanding anything in this section, the Comptroller shall permit the Minister,
the Auditor­General or any officer duly authorised in that behalf by the Auditor­General to
have such access to any records or documents as may be necessary for the performance of
his official duties.
(6) The Minister, the Auditor­General or any such officer shall be deemed to be a person
employed in carrying out the provisions of this Act for the purposes of this section.
(7) Notwithstanding anything in this section, the Comptroller may transmit any
document, information or return received by him or in his possession under this Act to the

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(a)
(b)
(a)
(b)
Commissioner of Estate Duties; and the Commissioner of Estate Duties may,
notwithstanding anything contained in any written law for the time being in force in
Singapore relating to the proof of documents, produce or cause to be produced in any court,
in any proceedings relating to estate or death duties, a copy of any particulars contained in
any document or return so transmitted, certified by him or on his behalf to be a correct copy
of such particulars.
(8) For the purposes of subsection (7), the Commissioner of Estate Duties —
may produce or cause to be produced the original of any such document or return
in any case where it is necessary to prove the handwriting or the signature of the
person who wrote, made, signed or furnished such document or return, but only
for the purpose of such proof;
shall not in any case be compelled to produce in any court either the original of
such document or return or a copy of any particulars contained in such document
or return.
(9) Notwithstanding anything in this section, the Comptroller may transmit to the
Comptroller of Property Tax, the Comptroller of Goods and Services Tax, the Chief Assessor
or the Commissioner of Stamp Duties any information which may be required by any of
them in the performance of his duties, or may permit such access to any records or
documents as may be necessary for those purposes.
(10) Notwithstanding anything in this section, the Comptroller may furnish to the Chief
Executive Officer of the Central Provident Fund Board any information which may be
required by him in the performance of his duties, or may permit such access to any records or
documents as may be necessary for that purpose.
(11) Notwithstanding anything in this section, the Comptroller may lay a complaint of
professional misconduct against any person in his professional dealings with the Comptroller
to the appropriate authority empowered to take disciplinary action against the person and
may in connection with the complaint furnish any relevant documents or information.
Rules
7.—(1) The Minister may make rules —
to provide for the deduction and payment of tax at the source in respect of income
from any employment, and for the recovery of tax so deducted; and
generally to give effect to the provisions of this Act, other than section 81.
(2) All rules made under this section shall be presented to Parliament as soon as possible
after publication in the Gazette.
Service and signature of notices
8.—(1) Except where it is provided by this Act that service shall be effected either
personally or by registered post, a notice may be served on a person either personally or by
being sent through the post.
(2) Where a notice is served by ordinary or registered post, it shall be deemed to have
[1/88; 31/93]
[4/75]

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(a)
(b)
(c)
(a)
(b)
(c)
(d)
been served on the day succeeding the day on which the notice would have been received in
the ordinary course of post if the notice is addressed —
in the case of a company incorporated in Singapore, to the registered office of the
company;
in the case of a company incorporated outside Singapore, either to the individual
authorised to accept service of process under the Companies Act (Cap. 50) at the
address filed with the Registrar of Companies, or to the registered office of the
company wherever it may be situated;
in the case of an individual or a body of persons, to the last known business or
private address of such individual or body of persons.
(3) Where the person to whom there has been addressed a registered letter containing any
notice which may be given under the provisions of this Act is informed of the fact that there
is a registered letter awaiting him at a post office and such person refuses or neglects to take
delivery of such registered letter, such notice shall be deemed to have been served upon him
on the date on which he was informed that there was a registered letter awaiting him at a post
office.
(4) Every noticeto be given by the Comptroller under this Act shall be signed by the
Comptroller or by some person or persons from time to time authorised by him in that behalf
under section 4, and every such notice shall be valid if the signature of the Comptroller or of
such person or persons is duly printed or written thereon.
(5) Any noticeunder this Act requiring the attendance of any person or witness before the
Comptroller shall be signed by the Comptroller or by a person duly authorised by him.
Free postage
9. All returns, additional information and resulting correspondence and payment of tax
under the provisions of this Act may be sent post­free to the Comptroller in envelopes
marked “Income Tax”.
PART III
IMPOSITION OF INCOME TAX
Charge of income tax
10.—(1) Income tax shall, subject to the provisions of this Act, be payable at the rate or
rates specified hereinafter for each year of assessment upon the income of any person
accruing in or derived from Singapore or received in Singapore from outside Singapore in
respect of —
gains or profits from any trade, business, profession or vocation, for whatever
period of time such trade, business, profession or vocation may have been carried
on or exercised;
gains or profits from any employment;
[Deleted by Act 29/65);]
dividends, interest or discounts;

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(e)
(f)
(g)
(a)
(b)
(i)
(ii)
(iii)
(c)
(d)
(a)
any pension, charge or annuity;
rents, royalties, premiums and any other profits arising from property; and
any gains or profits of an income nature not falling within any of the preceding
paragraphs.
(2) In subsection (1)(b), “gains or profits from any employment” means —
any wages, salary, leave pay, fee, commission, bonus, gratuity, perquisite or
allowance (other than a subsistence, travelling, conveyance or entertainment
allowance which is proved to the satisfaction of the Comptroller to have been
expended for purposes other than those in respect of which no deduction is
allowed under section 15) paid or granted in respect of the employment whether in
money or otherwise;
the value of any food, clothing or lodging provided or paid for by the employer;
the annual value of any place of residence provided by the employer and for the
purposes of this paragraph —
if the place of residence is “premises” within the repealed Control of Rent
Act (Cap. 58, 1985 Ed.) and is provided to a director of a company, or, if
the remuneration received by a director of a company is less than the
annual value of the premises, the full annual value shall be deemed to be
gains or profits of the employment;
except as provided in sub­paragraph (i), if the annual value of the
premises exceeds 10% of the gains or profits from the employment
mentioned in paragraphs (a) and (b) less the rent, if any, paid by the
employee for the use of the premises, the excess shall be disregarded;
where the premises are shared, “place of residence” means the part of the
premises occupied by the person chargeable;
any sum standing to the account of any individual in any pension or provident
fund or society which the individual is entitled to withdraw upon retirement or
which is withdrawn therefrom.
(3) Any sum realised under any insurance against loss of profits shall be taken into
account in the ascertainment of any profits or income.
(4) Where, under section 17, 20 or 21, a balancing charge falls to be made, the amount
thereof shall be deemed to be income chargeable with tax under this Act, except in the case
of a balancing charge in respect of —
a Singapore ship which is owned by a shipping enterprise within the meaning of
section 13A at the time the balancing charge falls to be made in respect of the
Singapore ship, but only up to the amount ascertained in accordance with the
formula
A
X C,
B
where A is the amount of allowances under section 19 made to the enterprise in
[26/73; 26/93; 28/96]

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(b)
(a)
(b)
(c)
respect of the Singapore ship against any income exempt from tax under
section 13A;
B is the total amount of allowances under section 19 or 19A which have
been made in respect of the ship during the period it is owned by the
enterprise; and
C is the amount of balancing charge;
a foreign ship the income derived from the operation of which would be income of
a shipping enterprise within the meaning of section 13A or income of an approved
international shipping enterprise within the meaning of section 13F, as the case
may be, but only up to the amount ascertained in accordance with the formula
X
X Z,
Y
where X is the amount of allowances under section 19 or 19A made to the
enterprise in respect of the foreign ship against any income exempt from tax under
section 13A or 13F, as the case may be;
Y is the total amount of allowances under section 19 or 19A which have
been made in respect of the ship during the period it is owned by the
enterprise; and
Z is the amount of balancing charge.
(5) Subsection (4)(b) shall apply, with the necessary modifications, to a floating
production storage offloading ship, floating storage offloading ship, dredger, seismic ship or
semi­submersible rig the income derived from the operation of which is exempt from tax
under section 13F.
(6) Any gains or profits, directly or indirectly, derived by any person from a right or
benefit granted on or after 1st January 2003, whether granted in his name or in the name of
his nominee or agent, to acquire shares in any company shall, where the right or benefit is
obtained by that person by reason of any office or employment held by him, be deemed to be
income chargeable to tax under subsection (1)(b), accruing at such time and of such amount
as determined under the following provisions:
where the right or benefit is exercised, assigned, released or acquired, at the time
of the exercise, assignment, release or acquisition of the right or benefit and the
gains or profits shall be the price of the shares in the open market at that time, less
any amount paid for the shares;
notwithstanding paragraph (a), where the right or benefit granted is subject to any
restriction on the sale of the shares so acquired, at the time the restriction ceases to
apply and the gains or profits shall be the price of the shares in the open market at
that time, less any amount paid for the shares;
if it is not possible to determine the gains or profits under paragraph (a) or (b), the
Comptroller may use the net asset value of the shares, less any amount paid for the
shares, as the basis for determining the gains or profits;
[2/92; 32/95; 31/98]
[37/2002]

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(d)
(e)
(f)
(a)
(i)
(ii)
(b)
(A)
(B)
(a)
(b)
(c)
notwithstanding paragraphs (a) and (c), any gains or profits derived by him by any
exercise of a right or benefit to acquire shares in any company listed on the
Singapore Exchange shall be the last done price on the listing date of the shares so
acquired less the amount paid for the shares;
“the last done price on the listing date”, in relation to any shares referred to in
paragraph (d), means the price of the shares in the open market at the last
transaction on the date on which the shares are first listed on the Singapore
Exchange after the acquisition of the shares by him; and
“shares” includes stocks.
(6A) For the avoidance of doubt, section 10(5) in force immediately before 10th
December 2002 shall continue to apply to any gains or profits directly or indirectly derived
by the exercise, assignment or release of any right or benefit to acquire shares (including
stocks) in a company granted to a person before 1st January 2003, whether in his name or in
the name of his nominee or agent, where the right or benefit was obtained by that person by
reason of any office or employment held by him.
(7) Notwithstanding subsection (6), where —
the right or benefit to acquire shares in a company is granted on or after 1st
January 2003 to an individual while he is exercising an employment in Singapore;
and
immediately before he ceases that employment —
the individual is neither a citizen of Singapore nor a Singapore permanent
resident, or being a Singapore permanent resident is leaving Singapore
permanently; and
the right or benefit is not exercised, assigned, released or acquired by him,
or the restriction on the sale of the shares has not ceased to apply,
any gains or profits from the right or benefit shall be —
deemed to be income derived by the individual one month before the date of
cessation of employment or the date the right or benefit is granted, whichever is
the later; and
computed based on the price of the shares in the open market on that date, less the
amount paid for the shares.
(7A) The Comptroller may, if he thinks fit and subject to such condition as he may
impose, accept from the employer of an individual to whom subsection (7) applies an
undertaking —
to make a return, in such form and by such time as the Comptroller may
determine, of any gains or profits derived by the individual from the right or
benefit to acquire shares in a company as computed under subsection (6);
to pay to the Comptroller any tax assessed on such gains or profits; and
to pay the penalties specified in the undertaking for any failure to comply with
[37/2002]
[7/2007 wef 10/12/2002]
[37/2002]

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(a)
(b)
(a)
(b)
(i)
(ii)
(c)
paragraph (a) or (b).
(7B) Where the Comptroller accepts an undertaking from the employer of an individual
under subsection (7A), subsection (7) shall not apply to the individual and he shall be
assessed in accordance with subsection (6).
(7C) If any condition imposed by the Comptroller under subsection (7A) has not been
complied with by the employer of an individual, then notwithstanding the undertaking given
by the employer, the gains or profits derived by the individual from the right or benefit to
acquire shares in a company shall be assessed in accordance with subsection (7) and shall be
deemed to be income accruing to the individual in the year in which the condition is not
complied with.
(8) Subsection (6)(c) shall apply, with the necessary modifications, to gains or profits
derived by an individual referred to in subsection (7).
(9) For the purposes of subsection (1)(e), the income derived from an annuity for any
year shall be deemed to be an amount equal to 3% of the total consideration payable or paid
for the purchase of the annuity except that the whole amount of the annuity shall be deemed
to be income if —
the person deriving income from the annuity has previously received sums equal
to the total consideration for the annuity exclusive of the amounts deemed to be
income under this subsection; or
the annuity is purchased by the employer of the person deriving on or after 1st
January 1993 such income in lieu of any pension or other benefit payable during
his employment or upon his retirement.
(10) Subsection (9) shall not apply to any annuity purchased under the SRS.
(11) For the purposes of subsection (1)(f) —
“any other profits arising from property” shall be deemed to include the net annual
value of property used by or on behalf of the owner for residential purposes and
not for the purposes of gain or profit;
“net annual value”, in relation to any property, means the annual value of such
property less the expenses of repair, insurance, interest, maintenance or upkeep
and all public rates and taxes paid thereon;
in respect of any one property which is occupied for residential purposes by the
owner thereof —
the net annual value of such property; or
an amount equal to such sum as the Minister may, by order published in
the Gazette, specify,1
1 For the Year of Assessment 1997 and subsequent Years of Assessment the
sum specified is $150,000 — see G.N. No. S 240/96
[49/2004 wef 01/01/2003]
[49/2004 wef 01/01/2003]
[49/2004 wef 01/01/2003]
[37/2002]
[4/75; 26/93]
[24/2001]

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(a)
(i)
(ii)
(b)
(c)
(a)
(b)
(a)
(b)
whichever is the less, shall not be deemed to be profits arising from property; and
for the purposes of this paragraph any property owned by a married woman living
with her husband shall be deemed to be owned by the husband.
(12) Where a person derives interest from a negotiable certificate of deposit or derives
gains or profits from the sale thereof, his income shall be treated as follows:
in the case of a financial institution the interest and the gains or profits shall be
deemed to be income from a trade or business under subsection (1)(a);
in any other case the interest and the gains or profits shall be deemed to be income
from interest under subsection (1)(d) subject to the following provisions:
if the interest is received by a subsequent holder of a certificate of deposit
the income derived from such interest shall exclude the amount by which
the purchase price exceeds the issued price of the certificate, except where
that amount has been excluded in the computation of any previous interest
derived by him in respect of that certificate; and
where a subsequent holder sells a certificate after receiving interest
therefrom the gains or profits shall be deemed to be the amount by which
the sale price exceeds the issued price or the purchase price, whichever is
the lower; and
for the purposes of paragraph (b), where a subsequent holder purchases a
certificate at a price which is less than the issued price and holds the certificate
until its maturity, the amount by which the issued price exceeds the purchase price
shall be deemed to be interest derived by him.
(13) Any maintenance payment received by —
a child under a maintenance order or a deed of separation; or
a parent under a maintenance order made under the Maintenance of Parents Act
(Cap. 167B),
shall not be deemed to be income for the purposes of subsection (1).
(14) For the purposes of subsection (1)(a) and (f), the income derived by any author,
composer or choreographer, or any company in which he beneficially owns all the issued
share capital, from any royalties or other payments received from a person carrying on in
Singapore the business of publishing, of recording music or of producing cinematograph
films, choreographic works or plays as consideration for the assignment of or for the right to
use the copyright in any literary, dramatic, musical or artistic work, shall be deemed to be —
the amount of the royalties or other payments remaining after the deductions
allowable under Parts V and VI have been made; or
an amount equal to 10% of the gross amount of the royalties or other payments,
whichever is the less.
(15) Subsection (14) shall not apply to royalties or payments received in respect of any
[7/70; 9/80]
[4/75]
[28/96]
[24/2000]

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(a)
(b)
(a)
(b)
(a)
(b)
work published in any newspaper or periodical.
(16) For the purposes of subsection (1)(a) and (f), the income derived by an individual
who is an inventor, author or proprietor of an approved invention or approved innovation,
from any royalties or other payments received as consideration for the assignment of or for
the rights in the approved invention or approved innovation shall be deemed to be —
the amount of the royalties or other payments remaining after the deductions
allowable under Parts V and VI have been made; or
an amount equal to 10% of the gross amount of the royalties or other payments,
whichever is the less.
(17) Notwithstanding subsection (16), where it appears to the Comptroller that any
amount of income which has been determined under that subsection for the purposes of
subsection (1)(a) or (f) ought not to have been so determined for any year of assessment, the
Comptroller may, within 6 years after the end of that year of assessment, make such
assessment or additional assessment upon the individual as may be necessary in order to
make good any loss of tax.
(18) In subsection (16) —
“approved” means approved for such period not exceeding 5 years by the Minister or
such person as he may appoint;
“innovation” means —
any new product or new service, or any new method used in the manufacture
or processing of goods or materials or in the provision of services; or
any substantial improvement in any product or in the provision of any
service, or in any method used in the manufacture or processing of goods or
materials or in the provision of services,
which involves novelty or originality;
“rights in the approved invention or approved innovation” means the rights relating to
any patent, copyright, industrial design, trade mark or know­how of an approved
invention or approved innovation where a substantial part of the work in
developing the invention or innovation is undertaken in Singapore.
(19) Any distribution made by a unit trust approved under section 10B out of gains or
profits derived on or after 1st July 1989 from the disposal of securities and which have not
been subject to tax shall be deemed to be income if received by a unit holder except where
the unit holder is —
an individual resident in Singapore; or
a person who is not resident in Singapore and has no permanent establishment in
Singapore.
(20) Any distribution made by a designated unit trust to any unit holder or by an approved
[1/88]
[24/2000]
[11/94]
[24/2000]
[23/90]

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(a)
(b)
(c)
(a)
(i)
(ii)
(b)
(i)
(ii)
(c)
CPF unit trust to any unit holder out of —
gains or profits derived from Singapore or elsewhere from the disposal of
securities;
interest (other than interest for which tax has been deducted under section 45); and
dividends derived from outside Singapore and received in Singapore,
which do not form part of the statutory income of the designated unit trust or approved CPF
unit trust by virtue of section 35(12) shall, subject to subsection (21), be deemed to be
income of the unit holder if he is not a foreign investor.
(21) Where any distribution made out of gains or profits referred to in subsection (20)(a)
is made to a unit holder who is an individual resident in Singapore, the distribution, if made
on or after 28th February 1998, shall not be deemed to be income of that unit holder.
(22) Where a designated unit trust had also been approved under section 10B, any
distribution made by the designated unit trust out of any income (including gains or profits
from the disposal of securities) derived by it during the period the designated unit trust was
approved under section 10B shall be treated as income of a unit holder in accordance with
subsection (19) and section 35(11) and (15).
(23) In subsections (20),(21) and (22) —
“approved CPF unit trust” has the same meaning as in section 35(14);
“designated unit trust” means any unit trust designated under section 35(14);
“foreign investor” —
in relation to an individual, means an individual who is not resident in
Singapore;
in relation to a company, means a company which is not resident in
Singapore and —
in the case of a company with not more than 50 shareholders, the
whole of its issued capital is beneficially owned, directly or
indirectly, by persons who are not citizens of Singapore and not
resident in Singapore; and
in the case of a company with more than 50 shareholders, not less
than 80% of its issued capital is beneficially owned, directly or
indirectly, by persons who are not citizens of Singapore and not
resident in Singapore; and
in relation to a trust fund, means a trust fund where at least 80% of the value
of the fund is beneficially held, directly or indirectly, by foreign investors
referred to in paragraph (a) or (b) and, unless waived by the Minister or such
person as he may appoint, where —
the fund is created outside Singapore; and
the trustees of the fund are neither citizens of Singapore nor resident
[32/95; 31/98; 24/2000]
[32/95; 31/98]
[32/95]

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(a)
(b)
(c)
(a)
(b)
(c)
(d)
in Singapore.
(24) For the purposes of subsection (2)(d), the sum standing to the account of any
individual in any pension or provident fund or society, other than a pension or provident fund
to which section 10C applies, shall be deemed to accrue to the individual on the date he is
entitled to the sum upon retirement or on the date he withdraws any sum before his
retirement, as the case may be, except that where upon his retirement an individual is entitled
to elect under the rules or constitution of the pension or provident fund or society as to the
manner and amount of the sum to be withdrawn, only the amount so withdrawn shall be
deemed to be income of the individual accruing on the date of withdrawal.
(25) It is hereby declared for the avoidance of doubt that the amounts described in the
following paragraphs shall be income received in Singapore from outside Singapore whether
or not the source from which the income is derived has ceased:
any amount from any income derived from outside Singapore which is remitted to,
transmitted or brought into, Singapore;
any amount from any income derived from outside Singapore which is applied in
or towards satisfaction of any debt incurred in respect of a trade or business
carried on in Singapore; and
any amount from any income derived from outside Singapore which is applied to
purchase any movable property which is brought into Singapore.
(26) Any payment accrued to a self­employed woman under section 9(2) of the Children
Development Co­Savings Act (Cap. 38A) shall be deemed to be income from her trade,
business, profession or vocation chargeable to tax under subsection (1)(a).
Profits of investment company
10A.—(1) Notwithstanding any other provisions of this Act, the Minister may by
regulations —
provide that tax on gains or profits derived from the disposal of securities (other
than transferred securities to which section 10N applies) by an approved
investment company shall be levied and paid for each year of assessment upon
such amount as may be determined by reference to the period during which those
securities have been held;
provide for the deduction of such amount of allowances under section 19, 19A, 20,
21 or 23 to be granted in such manner as may be prescribed;
provide for the deduction of such amount of losses arising from the disposal of
securities (other than transferred securities to which section 10N applies) as may
be determined by reference to the period during which those securities have been
held;
provide for the deduction of such amounts of expenses and donations allowable
under this Act in such manner as may be prescribed.
[32/95; 31/98]
[26/93]
[32/95]
[24/2001]
[3/89; 37/2002]

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(a)
(b)
(c)
(a)
(b)
(c)
(d)
(2) In this section —
“approved” means approved by the Minister or such person as he may appoint;
“investment company” means any company whose business consists wholly or mainly
in the making of investments and the principal part of whose income is derived
therefrom;
“securities” means —
debentures, stocks, shares, bonds or notes issued by a government or
company;
any right or option in respect of any such debentures, stocks, shares, bonds or
notes; or
units in any unit trust within the meaning of section 10B.
Profits of unit trusts
10B.—(1) Notwithstanding any other provisions of this Act, the Minister may by
regulations —
provide that tax on gains or profits derived on or after 1st July 1989 from the
disposal of securities by an approved unit trust shall be levied and paid for each
year of assessment by the trustees upon such percentage of the gains or profits and
in such manner as may be prescribed;
provide for the deduction of such percentage of the losses arising from the
disposal of securities in such manner as may be prescribed;
provide for the deduction of expenses allowable under this Act to be granted in
such manner as may be prescribed;
provide for the deduction of tax by the trustees of the unit trust on any distribution
received by a unit holder which is deemed to be income under section 10(19).
(2) In this section —
“approved” means approved by the Minister or such person as he may appoint;
“securities” has the same meaning as in section 10A;
“unit” means a right or interest (whether described as a unit, a sub­unit or otherwise)
which may be acquired under a unit trust;
“unit trust” means any trust established for the purpose, or having the effect, of
providing facilities for the participation by persons as beneficiaries under a trust, in
profits or income arising from the acquisition, holding, management or disposal of
securities or any other property.
Excess provident fund contributions, etc., deemed to be income
10C.—(1) Notwithstanding section 13(1)(j), where in any year, contributions have been
made by an employer in respect of an employee under section 7 of the Central Provident
[23/90; 32/95]
[23/90]
[23/90]

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(a)
(b)
(a)
(b)
Fund Act (Cap. 36) —
any part of the employer’s contributions, in respect of ordinary or additional wages
paid to the employee in that year, which is not obligatory under that Act; or
the employer’s contributions in respect of that part of the additional wages which
exceeds $27,500 paid to the employee in that year,
shall be deemed to be income accruing to the employee for the year in which the wages are
paid.
(2) Notwithstanding subsection (1)(a), where in any year, contributions obligatory by
reason of a contract of employment are made by any relevant employer to the Central
Provident Fund in respect of overseas ordinary wages or overseas additional wages paid to
an employee in that year, that part of such contributions up to the relevant amount shall not
be deemed to be income accruing to the employee.
(3) Subsection (2) shall not apply to contributions made by an employer in any year from
1st January 1999 to the Central Provident Fund in respect of an employee who holds a
professional visit pass, an employment pass or a work permit in that year.
(4) Notwithstanding subsection (1)(a), where on or after 1st January 2003, contributions
are made by any employer for any year to the medisave account of an employee maintained
under the Central Provident Fund Act (Cap. 36) in lieu of hospitalisation or outpatient
medical benefits which the employer is obliged to provide by reason of a contract of
employment, such contributions up to $1,500 for that year shall, subject to subsections (5)
and (6), not be deemed to be income accruing to the employee.
(5) Where contributions referred to in subsection (4) are made in respect of an employee
by 2 or more employers for any year, the amount of such contributions not deemed to be
income accruing to the employee shall not exceed $1,500 for that year.
(6) Subsection (4) shall not apply to contributions made by an employer in any year from
1st January 1999 to the Central Provident Fund in respect of an employee who holds a
professional visit pass, an employment pass or a work permit in that year.
(7) Notwithstanding subsection (1)(b), where in any year all the ordinary wages of an
employee paid in that year do not exceed $66,000, and his total wages paid in the same
year —
do not exceed $93,500, the excess contributions under subsection (1)(b) shall not
be deemed to be income accruing to the employee;
exceed $93,500, only that part of such excess contributions made in respect of the
difference between the total wages and $93,500 shall be deemed to be income
accruing to the employee.
(8) Where in any year contributions under section 7 of the Central Provident Fund Act
(Cap. 36) have been made in respect of an employee employed by 2 or more employers and
the employers are related to each other, subsection (7) shall apply, with the necessary
[23/90]
[11/94]
[1/98]
[21/2003]
[21/2003]
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(a)
(b)
modifications, as if all the ordinary and additional wages from those related employers and
the contributions on those wages were paid by one employer.
(9) For the purposes of subsection (8), one employer shall be deemed to be related to
another where one of them, directly or indirectly, has the ability to control the other or where
both of them, directly or indirectly, are under the control of a common person.
(10) Subsections (1) to (9) shall apply, with the necessary modifications, to contributions
made by an employer to a designated pension or provident fund as if those contributions
were employer’s contributions to the Central Provident Fund.
(11) Where in any year contributions have been made by an employer in respect of an
employee to any pension or provident fund constituted outside Singapore, the whole of the
contributions made to that pension or provident fund shall be deemed to be income accruing
to the employee for the year in which the contributions are paid.
(12) In this section —
“additional wages” has the same meaning as in the Central Provident Fund Act;
“designated pension or provident fund” means an approved pension or provident fund
designated by the Minister under section 39(8);
“employer’s contributions” means the contributions made by any employer under
section 7(1) of the Central Provident Fund Act (Cap. 36) less the amount of
contributions recoverable by the employer from the wages of an employee under
section 7(2) of that Act;
“ordinary wages” has the same meaning as “ordinary wages for the month” in the
Central Provident Fund Act;
“overseas additional wages” means additional wages paid in respect of the
performance of any duty for any period outside Singapore;
“overseas ordinary wages” means ordinary wages paid in respect of the performance
of any duty for any period outside Singapore;
“overseas total wages”, in relation to any year, means the total of the overseas ordinary
wages and overseas additional wages in that year received by an employee;
“relevant amount” means the amount of contributions which would have been required
to be made by the relevant employer had such contributions been obligatory under
the Central Provident Fund Act in respect of —
the overseas total wages paid to an employee in any year less the aggregate
in that year of such part of the overseas ordinary wages paid to the employee
in every month in that year as exceeds $5,500; or
$93,500,
whichever is the less;
“relevant employer” means any company incorporated or registered under the
Companies Act (Cap. 50) or any person registered under the Business Registration
Act (Cap. 32);
“total wages”, in relation to any year, means the total of the ordinary and additional
[26/93]

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(i)
(ii)
(a)
(b)
(c)
(d)
(e)
(f)
wages in that year received by an employee;
“year” means any year from 1st January to 31st December.
Income from finance or operating lease
10D.—(1) Notwithstanding any other provisions of this Act, the Minister may by
regulations provide for the circumstances in which the Comptroller may direct that
allowances under section 19, 19A, 20, 21, 22 or 23 in respect of any machinery or plant
which is leased under a finance lease entered into on or after 1st April 1990 shall not be
made to the lessor but to the lessee as though the machinery or plant had been sold by the
lessor to the lessee.
(2) In determining the income of a lessor from the leasing of any machinery or plant,
other than those which have been treated as though they had been sold pursuant to
regulations made under subsection (1), the following provisions shall apply:
the Comptroller shall determine the manner and extent to which —
allowances under section 19, 19A, 20, 21, 22 or 23 and any expenses and
donations allowable under this Act are to be deducted;
any loss may be deducted under section 37;
where the lessor derives income from onshore leasing but does not derive income
from offshore leasing, the allowances under section 19, 19A, 20, 21, 22 or 23 in
respect of onshore finance leasing shall, subject to paragraph (c), only be available
as a deduction against the income from such onshore finance leasing and any
balance of the allowances shall not be available as a deduction against any other
income or be available for transfer under section 37C;
where the lessor referred to in paragraph (b) ceases to derive income from onshore
finance leasing in the basis period for any year of assessment, any balance of the
allowances after the deduction in paragraph (b) shall be available as a deduction
against any other income for that year of assessment or for any subsequent year of
assessment in accordance with section 23;
where the lessor derives income from both onshore leasing and offshore leasing
and such income is subject to tax under section 42(1) or 43(1), the allowances
under section 19, 19A, 20, 21, 22 or 23 in respect of the leasing under any finance
lease shall, subject to paragraph (e), only be available as a deduction against the
income from such finance lease and any balance of the allowances shall not be
available as a deduction against any other income or be available for transfer under
section 37C ;
where the lessor referred to in paragraph (d) ceases to derive income from the
leasing of any machinery or plant under any finance lease in the basis period for
any year of assessment, any balance of the allowances after the deduction in
paragraph (d) shall be available as a deduction against any other income for that
year of assessment and for any subsequent year of assessment in accordance with
section 23;
where the lessor is a leasing company which derives income from onshore leasing
[11/94]
[20/91]

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(i)
(ii)
(iii)
(a)
(b)
and also derives income from offshore leasing subject to the concessionary rate of
tax under section 43I —
the allowances under section 19, 19A, 20, 21, 22 or 23 in respect of
onshore finance leasing shall firstly be available as a deduction against the
income from such leasing and any balance of the allowances shall be
available as a deduction against any other income in accordance with such
regulations as may be prescribed;
the allowances under section 19, 19A, 20, 21, 22 or 23 in respect of
onshore operating leasing shall firstly be available as a deduction against
the income from such leasing and any balance of the allowances shall be
available as a deduction against any other income in accordance with such
regulations as may be prescribed;
any losses incurred in respect of onshore finance leasing or onshore
operating leasing shall be available as a deduction against any other
income in accordance with such regulations as may be prescribed.
(3) In this section —
“finance lease” means a lease of any machinery or plant (including any arrangement or
agreement in connection with the lease) which has the effect of transferring
substantially the obsolescence, risks or rewards incidental to ownership of such
machinery or plant to the lessee;
“leasing company” and “offshore leasing” have the same meanings as in
section 43I(9);
“onshore finance leasing” means the onshore leasing of any machinery or plant under
any finance lease;
“onshore leasing” means the leasing, other than offshore leasing, of any machinery or
plant;
“onshore operating leasing” means the onshore leasing of any machinery or plant,
other than onshore finance leasing.
Ascertainment of income of investment holding company
10E.—(1) Notwithstanding any other provisions of this Act, in determining the income of
a company or trustee of a property trust derived from any business of the making of
investments the following provisions shall apply:
any outgoings and expenses incurred by the company or trustee of a property trust
in respect of investments of that business which do not produce any income shall
not be allowed as a deduction under section 14 for that business or other income of
the company or trustee of a property trust;
any outgoings and expenses incurred by the company or trustee of a property trust
in respect of investments of that business which produce any income shall only be
available as a deduction under section 14 against the income derived from such
investments and any excess of such outgoings and expenses over such income in
[1/98; 37/2002]
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(c)
(a)
(b)
any year shall be disregarded; and
the allowances under sections 19, 19A, 20 and 21 relating to that business shall
only be available as a deduction against the income derived from investments of
that business which produce any income and the balance of the allowances in any
year shall be disregarded.
(2) In this section —
“business of the making of investments” includes the business of letting immovable
properties;
“immovable property­related assets” means debt securities and shares issued by
property companies, mortgaged­backed securities, other property trust funds, and
assets incidental to the ownership of immovable properties;
“investments” means securities, immovable properties and immovable property­related
assets;
“property trust” means a trust which invests in immovable properties or immovable
property­related assets.
10F.
10G.
Ascertainment of income from business of hiring out motor cars or providing driving
instruction
10H.—(1) Notwithstanding any other provisions of this Act, in determining the income
derived by any person for any year of assessment from any business of hiring out motor cars
or of providing driving instruction using motor cars, the following provisions shall apply:
any outgoings and expenses incurred in respect of that business for that year of
assessment and allowable under this Act shall only be deducted against the income
derived from that business and any excess of such outgoings and expenses over
such income shall not be available as a deduction against any other income of the
person or be available for transfer under section 37Cfor that year of assessment
and any subsequent year of assessment; and
the allowances under sections 19, 19A, 20, 21 and 22 relating to that business for
that year of assessment shall only be available as a deduction against the income
derived from that business and any excess of such allowances over such income
shall not be available as a deduction against any other income of the person or be
available for transfer under section 37Cfor that year of assessment and any
subsequent year of assessment.
(2) In this section, “motor car” means a car which is constructed or adapted for the
carriage of not more than 7 passengers exclusive of the driver and the weight of which
unladen does not exceed 3,000 kilograms.
Reduction of share capital
[32/95; 37/2002]
[32/95; 37/2002]
[32/99; 37/2002]
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(a)
(i)
(ii)
(iii)
(b)
(c)
10I.—(1) This section shall, subject to sections 10J, 10K and 10M, apply where a
company resident in Singapore reduces its share capital and the reduction of share capital
involves a payment to any shareholder of the company.
(2) Where the reduction of share capital is made out of the contributed capital of the
company, and a payment is made to any shareholder of the company pursuant to such
reduction, the payment to the shareholder shall not be regarded as a payment of dividend by
the company to the shareholder, and an amount equal to the payment shall be debited to the
contributed capital account referred to in subsection (5)(c)(i).
(3) Where the reduction of share capital is not made out of the contributed capital of the
company, and a payment is made to any shareholder of the company pursuant to such
reduction, the payment to the shareholder shall be deemed to be a dividend paid by the
company to the shareholder on the date of the payment, and the provisions relating to the
payment of dividends under this Act and the Economic Expansion Incentives (Relief from
Income Tax) Act (Cap. 86) shall apply, with the necessary modifications, to the dividend
deemed to be paid.
(4) Where the dividend deemed to be paid under subsection (3) is a dividend to which
section 44 applies, the amount of dividend deemed to be paid by the company to the
shareholder shall be deemed to be of such a gross amount as after deduction of tax at the rate
deductible at the date of payment would be equal to the amount of payment made by the
company to the shareholder.
(5) For the purposes of this section —
the share capital of a company shall include any share premium or capital
redemption reserve which is treated as paid­up share capital of the company for
the purpose of any reduction of share capital made by the company;
the contributed capital of a company as at any date shall be the aggregate of the
amounts received by the company, whether in cash or in the form of other valuable
consideration, for the shares it had issued up to that date reduced by —
the aggregate of the amounts of any payment made to any shareholder of
the company pursuant to any reduction of share capital by the company up
to that date which had not been treated as a payment of dividends for the
purpose of this Act;
the aggregate of the amounts of any payment made to any shareholder of
the company pursuant to any redemption of shares by the company up to
that date which had not been treated as a payment of dividends for the
purpose of this Act; and
the aggregate of the amounts of any other payment made to any
shareholder of the company pursuant to any return of share capital up to
that date which had not been treated as a payment of dividends for the
purpose of this Act;
in relation to the first reduction of its share capital made on or after 18th
November 1998 by any company, the contributed capital of the company
[32/99; 24/2001]
[32/99]
[32/99]
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(i)
(ii)
(d)
(e)
(i)
(ii)
(f)
(g)
(h)
immediately before the first reduction —
shall be credited to an account (referred to in this section as the
contributed capital account) to be kept by the company for the purposes of
this section; and
where the aggregate of the amounts of any payment referred to in
paragraph (b)(i), (ii) and (iii) exceeds the aggregate of the amounts
received by the company, whether in cash or in the form of other valuable
consideration, for the shares it had issued before the first reduction, the
amount to be credited to the contributed capital account shall be deemed
to be zero;
where any share is issued by a company subsequent to the first reduction of its
share capital referred to in paragraph (c), any amount received by the company,
whether in cash or in the form of other valuable consideration, for the shares it had
issued shall be credited to the contributed capital account;
where a company redeems any redeemable shares subsequent to the first reduction
of its share capital referred to in paragraph (c) and section 10K does not apply to
that redemption, any payment made to any shareholder for the purpose of that
redemption shall be debited to the contributed capital account where the payment
is not treated as a payment of dividends for the purpose of this Act;
where any reduction of share capital of a company was made before 18th
November 1998 for the purposes of or in connection with a scheme for the
reconstruction of any company or companies or the amalgamation of 2 or more
companies and such scheme resulted in the transfer of assets of the first­mentioned
company, whether directly by that company or indirectly through its shareholders,
to another company in exchange for shares in the transferee company, the
consideration equal to the value of the assets received by the transferee company
for the shares issued shall, notwithstanding paragraph (b), not form part of the
contributed capital of the transferee company where the payment made by the
first­mentioned company pursuant to the reduction of its share capital was —
not treated as a payment of dividend to the shareholder of the first­
mentioned company for the purpose of this Act; and
more than the contributed capital of the first­mentioned company
immediately before the reduction of its share capital;
where paragraph (f) is applicable to the contributed capital of a transferee
company, the contributed capital of the first­mentioned company under that
paragraph after the reduction of its share capital shall, notwithstanding
paragraph (b), not be reduced by the payment made by the first­mentioned
company for the reduction of its share capital; and
any amount applied by a company in paying up unissued shares of the company to
be issued to shareholders of the company as fully or partly paid bonus shares shall
not be regarded as receipts by the company from the issue of shares.
(6) A company shall deliver to the Comptroller a copy of the contributed capital account
made up to any date specified by the Comptroller whenever called upon to do so by notice in
[32/99]

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(a)
(b)
(a)
(b)
(a)
(b)
(a)
(b)
writing.
Shares buyback
10J.—(1) Where a company resident in Singapore purchases or otherwise acquires shares
issued by it from any shareholder of the company (referred to in this section as a buyback),
for the purposes of this section —
the buyback constitutes a market purchase if the purchase of the shares is made on
a stock exchange; and
the buyback constitutes an off­market purchase if the purchase of the shares is
made otherwise than on a stock exchange.
(2) Where a company undertakes a buyback described in subsection (1), any payment
made by the company to any shareholder for the buyback shall, to the extent that the
payment is made out of contributed capital of the company, not be regarded as a payment of
dividend by the company to the shareholder, and an amount equal to the payment shall be
debited to the contributed capital account kept by the company under section 10I(5)(c)(i).
(3) Where a company undertakes a buyback described in subsection (1), any payment
made by the company to any shareholder for the buyback shall, to the extent that the
payment is not made out of the contributed capital of the company, be deemed to be —
a dividend paid by the company on the date of the payment, and the provisions
relating to payment of dividends under this Act and the Economic Expansion
Incentives (Relief from Income Tax) Act (Cap. 86), shall apply, with the necessary
modifications, to the dividend deemed to be paid;
a dividend received by the shareholder (not being a transferee to whom
section 10N applies) where the buyback is an off­market purchase made in
accordance with an equal access scheme authorised in advance by the company at
a general meeting of the company.
(4) Notwithstanding subsection (3), where a company undertakes a buyback described in
subsection (1)(a) through a special trading counter established on the Singapore Exchange,
any payment made by the company to any shareholder for the buyback shall, to the extent
that the payment is not made out of the contributed capital of the company, be deemed to
be —
a dividend paid by the company on the date of the payment, and section 44 shall
apply, with the necessary modifications, to such dividend; and
a dividend received by the shareholder if the conditions in subsection (5) are
satisfied.
(5) The conditions referred to in subsection (4)(b) are —
the shares sold through the special trading counter are not acquired by the
shareholder through any securities lending or repurchase arrangement;
the shareholder has beneficially owned the shares for a continuous period of at
[32/99]
[32/99]
[32/99]
[32/99; 37/2002]
[24/2000]

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(c)
(d)
(a)
(b)
least 183 days ending immediately before the day of the sale of the share through
the special trading counter;
the shareholder has furnished to the Comptroller, or such other person as the
Comptroller may direct, a declaration relating to the ownership and other
particulars of the shares sold in such form and manner as may be approved by the
Comptroller; and
the company has complied with such requirements as may be imposed by the
Comptroller.
(6) Where the dividend deemed to be paid by a company under subsection (3)(a) is a
dividend to which section 44 applies, the amount of dividend so paid by the company and the
amount of dividend deemed to be received by the shareholder under subsection (3)(b) shall
be deemed to be of such a gross amount as after deduction of tax at the rate deductible at the
date of payment would be equal to the amount of payment made by the company to the
shareholder.
(7) The amount of any dividend deemed to be paid by a company under subsection (4)(a)
shall be deemed to be of such a gross amount as after deduction of tax under section 44 at the
rate deductible at the date of payment would be equal to the amount of payment made by the
company.
(8) The amount of any dividend deemed to be received by a shareholder under
subsection (4)(b) shall be deemed to be of such a gross amount as after deduction of tax
under section 44 at the rate deductible at the date of payment by the company would be equal
to the amount of payment received by the shareholder.
(9) Where any payment made by a company to any shareholder for a buyback is not
deemed to be a dividend received by the shareholder under subsection (3)(b) or (4)(b), no
set­off under section 46 shall be allowed to the shareholder in respect of the payment.
(10) Where a shareholder sells his shares to the company in an off­market purchase
referred to in subsection (3)(b) —
no deduction shall be allowed to him in respect of the costs he incurred to acquire
the shares he sold to the company; and
the cost of any remaining share in the company held by the shareholder
immediately after the sale shall be ascertained by the formula
A,
N
where A is the aggregate cost of all shares in the company held by the shareholder
immediately preceding the buyback of his shares; and
N is the number of remaining shares in the company held by the
shareholder after the buyback of his shares.
[24/2000]
[32/99]
[24/2000]
[24/2000]
[32/99; 24/2000]
[32/99]